1.Natural Gas Vehicle Incentives Agreement

ATTACHMENT A

Terms and Conditions

1.Natural Gas Vehicle Incentives Agreement

The Natural Gas VehicleIncentivesarebeing funded by the California Energy Commission (Energy Commission) through the Alternative and Renewable Fuel and Vehicle Technology Program.

The natural gas vehicle incentive Agreement (Agreement) is comprised of the incentive payment, the Applicant’s Natural Gas VehicleIncentive Reservation Form (ARF-1), these Terms and Conditions, all physical attachments to solicitation PON-13-610, and all documents incorporated expressly by reference.

2.Term of the Agreement

The Effective Date of this Agreement is when the Energy Commission approves the Agreement at an Energy Commission Business Meeting. This Agreement terminates 365 days following the effective date or when all incentive payments are disbursed, whichever is sooner, unless otherwise indicated in writing by the Commission Incentive Manager.

3.Attachments and References

The following are attached and hereby expressly incorporated into this Agreement.

• Energy Commission’s solicitation PON-13-610 and any addendums
• Natural Gas VehicleIncentive Reservation Confirmation Form (ARF-1)
• Natural Gas VehicleIncentive Payment Claim Form – Applicant (ARF-3)
• Natural Gas VehicleIncentive Payment Claim Form – Purchaser (ARF-4)
• Payee Data Record (STD. 204)

4.Funding Limitations

Any applicable federal, State, and local laws and regulations not expressly listed in this Agreement are incorporated herein as part of this Agreement.

5.Due Diligence

The Applicant is required to take timely actions which, taken collectively, complete the reservation and payment process.

6. Application of Incentive to After-Tax Sale Price

As a reminder to Applicants, incentives received under this Agreement may be applied to the after-tax sale price only. It is the responsibility of the Applicant to accurately report sales amounts for tax purposes prior to the incentive amount being deducted from the sale price.

7.Reports

a.Progress Reports

The Applicant shall submit monthly progress reports to the Commission Incentive Manager with the information required in the PON.

Number of copies: The Applicant shall submit one electronic copy of the monthly progress report.

Additional Information: Additional information may be required in the progress reports as specified in writing in advance by the Commission Incentive Manager.

b.Rights in Reports

The Energy Commission reserves the right to use and reproduce all reports and data produced and delivered pursuant to this Agreement, and reserves the right to authorize others to use or reproduce such materials. Each report becomes the property of the Energy Commission.

c.Failure to Comply with Reporting Requirements

Failure to comply with the monthly reporting requirements will be considered a material noncompliance with the terms of this Agreement. Noncompliance may result in suspension or termination of the Agreement, and withholding of future incentives under this PON. A willful failure to perform, a history of failure to perform, or unsatisfactory performance of this Agreement and/or other financial assistance awards, may also result in a debarment action to preclude future incentives and awards.

8.Publications - Legal Statement on Reports and Products

You are encouraged to publish or otherwise make publicly available the results of the work conducted under the award, with the following statement attached to such publications:

legal notice

This document was prepared as a result of work sponsored by the California Energy Commission. It does not necessarily represent the views of the Energy Commission, its employees, or the State of California. The Energy Commission, the State of California, its employees, contractors, and subcontractors make no warranty, express or implied, and assume no legal liability for the information in this document; nor does any party represent that the use of this information will not infringe upon privately owned rights.

9.Changes to the Agreement

a.Significant Changes to the Agreement

Significant changes to the Agreement must be approved through a formal amendment. Significant changes include, but are not limited to:

• Change of Applicant’s legal name,
• Change of Applicant,
• Changes to the Reservation amount that increases the amount reserved,
• Changes to extend the reservation period.

The Applicant shall submit a request in writing to the Commission Incentive Manager for any significant change. The Incentive Manager will notify the Applicant of the appropriate Energy Commission action within ten (10) working days of submittal of the request.

b.Non-significant Changes

Changes that are not significant to the Agreement do not need to be approved through a formal amendment. These changes shall be documented in a Letter of Agreement, signed by both parties.

10.Termination

This Agreement terminates at the end of the 365-day term of the Agreement or when all incentive payments have been disbursed, whichever is sooner. This Agreement may also be terminated for any reason set forth below. In such event, the Applicant agrees to use all reasonable efforts to mitigate the Applicant’s expenses and obligations hereunder.

a.With Cause

In the event of any breach by the Applicant of the conditions set forth in the PON or these Terms and Conditions, the Agreement may be terminated, without prejudice to any of the Energy Commission’s legal remedies, upon five (5) days written notice to the Applicant.

b.Without Cause

The Agreement may, at the Energy Commission’s option, be terminated without cause in whole or in part, upon giving thirty (30) days advance notice in writing to the Applicant by certified mail, return receipt requested.

11.Costs

The Applicant acknowledges that the Agreement requires the Applicant to perform tasks and reporting that it would perform in the ordinary course of business and that this Agreement does not increase the administrative expenses or costs of the Applicant. The Applicant therefore will not be reimbursed for administrative expenses associated with performing under this Agreement.

12.Stop Work

The Commission Incentive Manager may, at any time, by written notice to Applicant, require Applicant to stop all or any part of the work under this Agreement. Upon receipt of such stop work order, Applicant shall immediately take all necessary steps to comply therewith and to cease offering incentives under the PON. An equitable adjustment shall be made by the Energy Commission based upon a written request by the Applicant. Such adjustment request must be made by Applicant within thirty (30) days from the date of the stop work order. Applicant shall resume the work only upon receipt of written notice from the Commission Incentive Manager.

13.Standard of Performance

Applicant, in performing under this Agreement, shall be responsible for exercising the degree of skill and care required by customarily accepted good professional practices and procedures used in the Applicant’s field.

14.Payment of Incentives

The Energy Commission agrees to reimburse the Applicant only for actual incentives issued by the Applicant based on the allowable incentive amounts specified in the PON.

a.Payment Requests

The Applicant may request payment from the Energy Commission at any time during the term of this Agreement although it is preferred that payment requests be submitted with the monthly progress reports. The final payment request must be received by the Energy Commission no later than fifteen (15) days after the expiration date of this Agreement.

Payments will be made only on a reimbursement basis after the Applicant has submitted and the Commission Incentive Manager has approved the documentation required under the PON.

b.Documentation

Any payment request that is submitted without this documentation will not be authorized. If the documentation is incomplete, inadequate, or inaccurate, the Commission Incentive Manager will inform the Applicant and withhold the payment request until all required information is received or corrected. Any penalties or other costs imposed on or incurred by the Applicant because of delays in payment will be paid by the Applicant.

For claims on vehicles delivered at the point of sale, a payment request must be submitted using a completed Natural Gas Vehicle Incentive Payment Claim Form – Applicant (ARF–3) and a Natural Gas Vehicle Incentive Payment Claim Form – Purchaser (ARF–4). These forms must be accompanied by:

• A legible copy of the sale documents, signed by both the seller and purchaser, clearly displaying the purchaser name and purchase date, MSRP or equivalent, all applicable state and federal taxes and fees, all other costs and deductions, the origin and amount of all incentives including the Energy Commission incentive applied to the final price; and
• A copy of the California Department of Motor Vehicle registration form that shows the vehicle identification number and that the vehicle is registered in California.Application for Title or Registration (REG 343) will not be accepted. The motive power shown on the registration form must be natural gas.

For vehicles delivered after the point of sale or lease, the Energy Commission may authorize payment based on the completed Natural Gas Vehicle Incentive Payment Claim Form – Applicant (ARF–3) accompanied by:

• A legible copy of the sale documents or purchase order clearly signed by both the seller and the purchaser displaying the purchaser name and purchase date (tentative), a stock or order number for a given vehicle that can be uniquely linked to the VIN once the vehicle is delivered, MSRP or equivalent, all applicable state and federal taxes and fees, all other costs and deductions, and the origin and amount of all incentives including the Energy Commission incentive applied to the final price. (Note: a non-binding purchase order is not sufficient to receive payment.)

Upon delivery of the vehicle to the Purchaser, Applicant must submit the Natural Gas Vehicle Incentive Payment Claim Form – Purchaser (ARF–4), accompanied by:

• A copy of the California Department of Motor Vehicle registration form that shows the vehicle identification number and that the vehicle is registered in California.Application for Title or Registration (REG 343) will not be accepted. The motive power shown on the registration form must be natural gas.

Applicant is expected to submit the Natural Gas Vehicle Incentive Payment Claim Form – Purchaser (ARF-4)within 180 days following Applicant’s submission of the Natural Gas Vehicle Incentive Payment Claim Form – Applicant (ARF-3). The Energy Commission may authorize a limited extension of the 180-day period on a showing of good cause. Any request for an extension should be submitted in writing and include the number of vehicles remaining, the amount of additional time needed, and the reason for the need.

Failure to comply with the 180-day deadline or any extension granted to that deadline will result in the Applicant reimbursing the incentive amount in full to the Energy Commission within thirty (30) days of the elapsed deadline, and may result in removal of Applicant’s eligibility and/or a debarment action to preclude future incentives and awards.

c.State Controller’s Office

Payments are made by the State Controller’s Office.

d. No Sale Until Reservation Is In Place

In order to receive payment under this Agreement, vehicles subject to receiving an incentive cannot be sold until the reservation is in place (i.e,.approved by the Commission). In other words, the Energy Commission will not reimburse the incentive amount if sale occurs prior to the Energy Commission approving the reservation.

15.Fiscal Accounting Requirements

a.Accounting and Financial Methods

The Applicant shall establish a separate ledger account or fund for receipt and disbursement of Energy Commission funds. Expenditure details must be maintained in accordance with appropriate accounting practices.

b.Retention of Records

The Applicant shall retain all project records (including financial records, progress reports, reservation requests, and payment claims) for a minimum of three (3) years after the final payment has been received or three years after the Agreement term, whichever is later.

c.Audits

Upon written request from the Energy Commission, the Applicant shall provide detailed documentation of all finance and transaction matters at any time. In addition, the Applicant agrees to allow the Energy Commission or any other agency of the State, or their designated representative, upon written request, to have reasonable access to and the right of inspection of all records that pertain to this Agreement during the term of this Agreement (the reservation period) and for a period of three (3) years thereafter unless the Energy Commission notifies the Applicant, prior to the expiration of such three-year period, that a longer period of record retention is necessary. Further, the Applicant agrees to incorporate an audit within any scheduled audits, when specifically requested by the State.

Applicants are strongly encouraged to conduct annual audits in accordance with the single audit concept. The Applicant should provide two copies of the independent audit report and any resulting comments and correspondence to the Commission Incentive Manager within 30 days of the completion of such audits.

16.Indemnification

The Applicant agrees to indemnify, defend, and save harmless the State, its officers, agents, and employees from any and all claims and losses accruing or resulting to Applicant and to any and all contractors, subcontractors, material men, laborers, and any other person, firm, or corporation furnishing or supplying work, services, materials, or supplies in connection with the performance of this Agreement, and from any and all claims and losses accruing or resulting to any person, firm, or corporation who may be injured or damaged by the Applicant in the performance of this Agreement.

17.Disputes

In the event of a dispute or grievance between Applicant and the Energy Commission regarding this Agreement, a vehicle incentive reservation, or payment of the incentive, the following two-step procedure shall be followed by both parties. Applicant shall continue with responsibilities under this Agreement during any dispute. The 365-day period of this Agreement is not extended during any dispute.

a.Energy Commission Dispute Resolution

The Applicant shall first discuss the problem informally with the Commission Incentive Manager. If the problem cannot be resolved at this stage, the Applicant must direct the grievance together with any evidence, in writing, to the Energy Commission Grants and Loans Officer. The grievance must state the issues in the dispute, the legal authority or other basis for the Applicant's position and the remedy sought. The Energy Commission Grants and Loans Officer must make a determination on the problem within ten (10) working days after receipt of the written communication from the Applicant. The Grants and Loans Officer shall respond in writing to the Applicant, indicating a decision supported by reasons. Should the Applicant disagree with the Grants and Loans Officer decision, the Applicant may appeal to the second level.

The Applicant must prepare a letter indicating why the Grants and Loans Officer's decision is unacceptable, attaching to it the Applicant’s original statement of the dispute with supporting documents, along with a copy of the Grants and Loans Officer's response. This letter shall be sent to the Executive Director at the Energy Commission within ten (10) working days from receipt of the Grants and Loans Officer's decision. The Executive Director or designee shall meet with the Applicant to review the issues raised. A written decision signed by the Executive Director or designee shall be returned to the Applicant within twenty (20) working days of receipt of the Applicant’s letter. The Executive Director may exercise the option of presenting the decision to the Energy Commission at a business meeting. In this event, the 20 days to respond may be extended. The Executive Director shall notify the Applicant in writing at least fifteen (15) days prior to a business meeting at which the decision is discussed at the Executive Director’s request. Should the Applicant disagree with the Executive Director's decision, the Applicant may appeal to the Energy Commission at a regularly scheduled business meeting. Applicant will be provided with the current procedures for placing the appeal on an Energy Commission Business Meeting Agenda, if the Executive Director has not already done so.

18.Workers’ Compensation Insurance

a.Applicant hereby warrants that it carries Workers’ Compensation Insurance for all of its employees who will be engaged in the performance of this Agreement, and agrees to furnish to the Commission Incentive Manager satisfactory evidence of this insurance at any time the Commission Incentive Manager may request.

b.If Applicant is self-insured for worker’s compensation, it hereby warrants such self-insurance is permissible under the laws of the State of California and agrees to furnish to the Commission Incentive Manager satisfactory evidence of this insurance at any time the Commission Incentive Manager may request.

19.General Provisions